The Covid-19 crisis is threatening to wipe out most of the gains in corporate earnings accrued from the September 2019 cut in corporation income tax. The underlying earnings per share (EPS) of the benchmark Nifty 50 index are now down to Rs 428 per unit of the index from the January high of Rs 453 and inching towards the level prior to the tax cut.

The tax cut in September last year had resulted in a 10 per cent increase in the post-tax profits of index companies, and Nifty EPS shot up from around Rs 410 in the middle of September 2019 to Rs 450 after the tax cut. Analysts expect a ...